A judgment is a monetary award given to a plaintiff who prevails in a civil lawsuit. It is a non-criminal legal award, typically in the form of damages. 

Damages typically include a money award. A court or a jury may award a judgment. In certain cases, a judgment is awarded automatically due to the defendant’s failure to appear and defend a civil lawsuit.

Typically, a judgment is valid for 5 to 7 years but this varies by jurisdiction. For example, in certain states, such as New York, a judgment is valid for up to 20 years. There are numerous ways in which a plaintiff may collect their court judgments

A judgment may appear on an individual’s credit report pursuant to the Fair Credit Reporting Act (FCRA). The amount of time a judgment will appear on an individual’s credit report varies by state. 

A judgment is not reported directly to the credit bureaus but it is documented in county court records, which are reviewed by the credit bureaus. Judgements are treated as negative actions by the credit bureaus and will lower an individual’s credit score.

An example of a judgment is a default judgment. In civil lawsuits, defendants are required to file an answer to a complaint within 30 days. 

Filing an answer means responding to the allegations made in a complaint. If the defendant fails to file an answer within this timeframe or fails to appear in court, a default judgment may be entered against them. A default judgment is entered without a court hearing the case and acts as an automatic win for the plaintiff.

Once the default judgment is entered in the plaintiff’s favor, the plaintiff may collect any damages which the defendant owes as a result of the judgment. Damages are, in many cases, collected through the courts. 

For example, a defendant may be able to pay the money directly to the court, usually at the clerk’s office, or a garnishment may be filed. A garnishment deducts regular payments from the defendant’s paycheck or bank account until their debt is satisfied.

Prior to a default judgment being entered, a court will require that:

  • The defendant was served with a Summons and Complaint. The plaintiff must show Proof of Service of the Summons and Complaint and file it with the local court;
  • The time period the defendant has to respond has expired; and
  • The defendant has failed to file an answer to the complaint.

In certain jurisdictions, a defendant must also be served with a statement of damages. This statement is a list of the money that the plaintiff is seeking.

It is important to note that a default judgment may be entered even if a defendant files an answer to the complaint. A court may grant a default judgment if a defendant fails to appear at a court hearing or does not have a legal defense to the lawsuit.

Can a Default Judgment be Removed?

There are some instances in which a default judgment may be removed. The process of removing a default judgment is known as vacating the judgment or setting aside the judgment.

In order to have a default judgment vacated or set aside, the individual must present the court a valid reason to do so. This can be accomplished by filing a motion to vacate default judgment with the court, which requests the court withdraw the original judgment. 

In this motion to vacate, the individual must provide reasons to set aside the default judgment. This may include reasons why they failed to respond to the complaint or missed a court appearance, which may include:

  • Mistake; 
  • Inadvertence; 
  • Surprise; 
  • Excusable neglect;
  • Lack of notice;
  • Clerical mistake;
  • New evidence was discovered;
  • Fraud;
  • The judgment was satisfied or discharged; or
  • Some other compelling reason justifying the defendant’s failure to answer.

Typically, the court will hold a hearing regarding the motion to vacate and determine whether or not to grant the motion. The success rate of these types of motions varies from court to court.

It is important to note, however, that due to the complexity of the legal system, motions to vacate default judgments are fairly liberally granted. A court is more inclined to provide each party an opportunity to argue their side of the case based upon the merits of the case rather than permitting a default judgment to stand.

In addition, the types of arguments the defendant may be able to make depend on how long the default judgment has been entered. For example, if a defendant attempts to argue mistake, inadvertence, surprise or provide an excuse when the judgment has been entered for a year or more may find themselves facing a more hostile court.

If, however, the individual was outside of the country or was not properly served with the papers, the court is more likely to be understanding. It is important to note that having a motion to vacate a default judgment granted is not the same as winning the case. Setting aside a default judgment simply provides a party with an opportunity to file an answer to the original complaint.

One common example of a vacated judgment may occur when a default judgment is erroneously entered against a plaintiff who was not actually liable for the debt. This occurs in cases where individuals share the same name. 

In these cases, the court would vacate the judgment and enter the judgment against the proper plaintiff. This is one very important reason individuals should review their credit reports periodically, yearly if possible.

What are Other Options Besides Default Judgments?

There are other types of civil judgments which may be available besides a default judgment. These may include:

  • Summary judgment;
  • Judgment notwithstanding the verdict; and
  • Consent judgment.

A summary judgment is a decision which is made based upon the merits of the law. A summary judgment decision is made without having a trial. To obtain a summary judgment, a plaintiff will file a motion for summary judgment:

  • Based upon a prior law;
  • When the facts are not in dispute; or
  • When the defendant does not have an adequate defense.

A judgment notwithstanding the verdict is a judgment which is made in favor of one party despite the fact that a verdict was returned in favor of the opposing party. In these cases, the court may overturn a jury verdict when it believes that there is insufficient evidence to justify the verdict which the jury returned.

A consent judgment, also called an agreed judgment, is an agreement between the parties to the lawsuit used to resolve the case. Once the agreement is made between the parties, the court will examine and evaluate their terms. If the agreement is approved, the court will enter the consent judgment.

Should I Consult an Attorney?

Yes, it is extremely important to consult with an experienced attorney if a default judgment has been entered against you. Your attorney will be able to investigate the circumstances, assist in filing the motion to vacate, and represent you during court appearances. A local attorney will be familiar with the local laws and rules as well as the local courts and will be in the best position to present a persuasive argument to the court.